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Dole plc Reports Fourth Quarter and Full Year 2021 Financial Results

Dole plc (NYSE: DOLE) ("Dole" or the "Group" or the "Company") has today released its financial results for the fourth quarter and fiscal year ended December 31, 2021.

Highlights for FY’21:

  • Transformational year for the Group
  • Significant increase in scale and footprint following acquisition of remaining 55.0% of Dole Food Company, Inc. ("DFC" or "Legacy Dole") by Total Produce plc ("TP") to create Dole plc ("Dole")
  • Following the acquisition, revenue has increased 113.7%, Adjusted EBITDA1 56.5% and total assets 147.5%
  • On a pro-forma2 basis, revenue increased 3.5% and Adjusted EBITDA increased 5.9% for the full year
  • Group is well positioned for long term sustainable growth following completion of IPO and debt refinancing
  • Net Debt1 / pro-forma Adjusted EBITDA 2.87x as of December 31, 2021

Transformational impact of the acquisition of DFC by TP

On July 29, 2021, TP completed the acquisition of the remaining 55.0% of DFC, to create Dole plc. Following this acquisition, the Group has increased significantly in scale and geographical footprint. Revenue has increased 48.5% to $6.5 billion for the full year 2021 compared to 2020. Pro-forma revenue for the full year 2021 of $9.3 billion has increased 113.7% compared to revenue for 2020. Revenue for 2021 includes five months of DFC revenue for the period of July 30, 2021 to December 31, 2021.

Adjusted EBITDA has increased 15.3% to $290.1 million for the full year 2021 compared to 2020. Pro-forma Adjusted EBITDA for the full year 2021 of $393.6 million has increased 56.5% compared to Adjusted EBITDA for 2020. Adjusted EBITDA for 2021 includes five months of DFC Adjusted EBITDA for the period of July 30, 2021 to December 31, 2021, and TP's 45.0% share of DFC Adjusted EBITDA for seven months for the period of January 1, 2021 to July 29, 2021.

Total assets has increased 147.5% to $4.7 billion following the acquisition. The Group now has a strategic and valuable asset base, including over 114,000 acres of owned land and other land holdings, over 160 distribution and manufacturing facilities, 75 packing houses, 12 cold storage facilities, five salad manufacturing plants and 13 owned vessels.

 

FY’21

FY’21

FY’20

Variance

Variance

 

Pro-forma

Reported (Unaudited)

Reported

Pro-forma FY'21 v Reported FY'20

Reported FY'21 v Reported FY'20

Revenue - $’m (2)

9,286

6,454

4,346

+113.7%

+48.5%

Adjusted EBITDA - $’m (1), (2)

393.6

290.1

251.5

+56.5%

+15.3%

Total Assets - $’m

 

4,668

1,886

 

+147.5%

_______________________________

1 Dole plc reports its financial results in accordance with U.S. Generally Accepted Accounting Principles ("GAAP"). Adjusted EBITDA, Adjusted Net Income, Adjusted Earnings Per Share and Net Debt are non-GAAP financial measures. Refer to the end of this release for an explanation and reconciliation of these and other non-GAAP financial measures used in this release to comparable GAAP measures.

2 This press release contains pro-forma financial information. The unaudited pro-forma consolidated financial statements for Dole plc illustrate the effects of the acquisition of DFC by TP and the effects of the IPO and refinancing as if they had occurred on January 1, 2020. This is comparable to the pro-forma financial statements presented in the Form F-1 filed with the SEC at the time of the IPO. The financial statements which will be filed in due course with the SEC, and which will be available on our website once filed ( https://www.doleplc.com/investors), will contain the results of TP for the first 7 months to July 29, 2021 (including equity earnings from TP’s 45.0% shareholding in DFC) plus the combined results of TP and DFC from July 30, 2021 to December 31, 2021. Comparative period results to December 31, 2020, are comprised of the full year results of TP including equity earnings from TP’s 45.0% shareholding in DFC.

Pro-forma Financial Information - Highlights (Unaudited)

 

Q4'21

Q4'20

FY’21

FY’20

FY Variance

Pro-forma Revenue - $’m (2)

2,251

2,201

9,286

8,969

+3.5%

Pro-forma Adjusted EBITDA - $’m (1), (2)

61.1

71.8

393.6

371.8

+5.9%

Pro-forma Adjusted Net Income - $’m (1), (2)

13.5

18.0

141.2

126.3

+11.8%

Pro-forma Adjusted Fully Diluted EPS - $ (1), (2)

0.14

0.19

1.49

1.33

+11.8%

Commenting on the results, Carl McCann, Executive Chairman said:

“2021 marked a transformational year for the Group following the acquisition of the remaining 55.0% of DFC by Dole plc and the subsequent IPO of the Group on NYSE. Our scale and footprint have increased significantly and we are well positioned to deliver long term sustainable growth. The Group delivered a strong performance for the full year of 2021, with growth across key metrics in line with guidance. Our diversified business model has continued to provide resilience within a challenging macroeconomic environment, while our strategic asset base and multi-continental sourcing model provide a competitive advantage. Our people have once again been the driver of this strong performance and we thank them for their dedication and determination.

“For the 2022 financial year, we are targeting revenue in the range of $9.6 billion to $9.9 billion and Adjusted EBITDA of $370.0 million to $380.0 million. The year on year expected reduction in Adjusted EBITDA is primarily due to the significant impact of the Value Added Salads product recall and temporary plant closures. We are monitoring the ongoing geopolitical situation in Ukraine and Russia; however, it is difficult to predict today what impact this may have on the macroeconomic environment and our business."

Pro-forma revenue for the fourth quarter increased 2.3% to $2.3 billion. The increase was driven by growth in the Fresh Fruit, Diversified Fresh Produce – EMEA and Diversified Fresh Produce – Americas & ROW reporting segments.

Pro-forma revenue for the full year 2021 increased 3.5% to $9.3 billion. The increase in full year pro-forma revenue was driven by growth across all reporting segments.

Pro-forma Adjusted EBITDA for the fourth quarter decreased 14.9% to $61.1 million. The decrease was predominantly driven by a decrease in Fresh Vegetables due to the impact of the product recall, a reduction in Fresh Fruit due to the continued impact of input cost inflation, and a slight decrease in Diversified Fresh Produce - EMEA. These decreases were partially offset by a strong performance within Diversified Fresh Produce – Americas & ROW.

Pro-forma Adjusted EBITDA for the full year 2021 increased 5.9% to $393.6 million. The increase was driven by a strong performance in Fresh Fruit and Diversified Fresh Produce – EMEA.

Pro-forma Adjusted Net Income for the fourth quarter decreased 25.0% to $13.5 million, predominantly due to the decrease in pro-forma Adjusted EBITDA in the quarter.

Pro-forma Adjusted Net Income for the full year 2021 increased 11.8% to $141.2 million, driven by the increase in pro-forma Adjusted EBITDA and decrease in the effective tax rate, which was partially offset by an increase in depreciation charges and increase in earnings attributable to non-controlling shareholder interests.

Value Added Salads Product Recall and Temporary Plant Closures Update

In December of 2021, we announced a voluntary recall for all packaged salads processed at our Bessemer City, North Carolina and Yuma, Arizona facilities due to a possible health risk from Listeria monocytogenes. We temporarily suspended operations at both facilities to facilitate proper investigation and sanitation procedures. In January of 2022, after we identified that the likely source of the contamination was a single piece of harvesting equipment that had been contaminated from the natural environment, we issued another recall of packaged salads processed at our Springfield, Ohio and Soledad, California facilities that handled product that had been harvested on that equipment. Operations were not fully suspended at the Soledad and Springfield locations as a result of that recall. Through genetic testing and in cooperation with the FDA, we ultimately confirmed that the harvest equipment was the source and that our processing facilities were not harboring any contamination. Our plants have now returned to operating at full capacity.

Incremental exceptional costs as a result of these recalls and temporary plant closures include costs for the disposal of affected inventory and packaging, reimbursements of charges to customers, penalties charged by customers, direct labor and benefits, freight for redirecting trucks carrying affected products, legal considerations and incremental sanitization procedures. The known and expected impact of these exceptional one-off costs for the 2021 recall is estimated at $17.6 million for the Fresh Vegetables segment. In addition, we also estimated a reduction of $3.3 million in Adjusted EBITDA in 2021 arising from the impact of temporary lost volumes and fixed cost absorption.

Total expected exceptional one-off costs in fiscal year 2022 related to the recalls and temporary plant closures are approximately $15.0 million. In addition, we also estimate a reduction in Adjusted EBITDA of approximately $25.0 million arising from the impact of temporary lost volumes, fixed cost absorption and delays in initiating price increases needed to address inflation.

The total impact of both recalls and the temporary plant closures is uncertain and may be subject to change.

Selected Pro-forma Quarterly Segmental Financial Information (Unaudited)

 

Q1'21

 

Q2'21

 

Q3'21

 

Q4'21

 

FY'21

 

(U.S. Dollars in thousands)

Revenue

 

 

 

 

 

 

 

 

 

Fresh Fruit

$

744,614

 

 

$

778,798

 

 

$

672,737

 

 

$

680,881

 

 

$

2,877,030

 

Diversified Fresh Produce - EMEA

 

793,740

 

 

 

951,848

 

 

 

877,423

 

 

 

815,330

 

 

 

3,438,341

 

Diversified Fresh Produce - Americas & ROW

 

421,693

 

 

 

423,966

 

 

 

453,704

 

 

 

479,702

 

 

 

1,779,065

 

Fresh Vegetables

 

327,701

 

 

 

332,273

 

 

 

323,772

 

 

 

296,848

 

 

 

1,280,594

 

Intersegment

 

(21,985

)

 

 

(24,493

)

 

 

(21,599

)

 

 

(21,281

)

 

 

(89,358

)

Total

$

2,265,763

 

 

$

2,462,392

 

 

$

2,306,037

 

 

$

2,251,480

 

 

$

9,285,672

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

 

 

 

 

 

 

 

 

Fresh Fruit

$

91,587

 

 

$

85,726

 

 

$

16,992

 

 

$

15,694

 

 

$

209,999

 

Diversified Fresh Produce - EMEA

 

24,927

 

 

 

40,984

 

 

 

35,852

 

 

 

29,363

 

 

 

131,126

 

Diversified Fresh Produce - Americas & ROW

 

10,096

 

 

 

18,118

 

 

 

4,281

 

 

 

20,574

 

 

 

53,069

 

Fresh Vegetables

 

4,534

 

 

 

(1,553

)

 

 

925

 

 

 

(4,520

)

 

 

(614

)

Total

$

131,144

 

 

$

143,275

 

 

$

58,050

 

 

$

61,111

 

 

$

393,580

 

Q1'20

 

Q2'20

 

Q3'20

 

Q4'20

 

FY'20

 

(U.S. Dollars in thousands)

Revenue

 

 

 

 

 

 

 

 

 

Fresh Fruit

$

763,646

 

 

$

712,712

 

 

$

682,194

 

 

$

636,987

 

 

$

2,795,539

 

Diversified Fresh Produce - EMEA

 

742,871

 

 

 

852,110

 

 

 

886,443

 

 

 

781,524

 

 

 

3,262,948

 

Diversified Fresh Produce - Americas & ROW

 

381,999

 

 

 

416,993

 

 

 

438,283

 

 

 

475,995

 

 

 

1,713,270

 

Fresh Vegetables

 

308,692

 

 

 

313,996

 

 

 

320,543

 

 

 

324,375

 

 

 

1,267,606

 

Intersegment

 

(17,490

)

 

 

(17,489

)

 

 

(17,490

)

 

 

(17,489

)

 

 

(69,958

)

Total

$

2,179,718

 

 

$

2,278,322

 

 

$

2,309,973

 

 

$

2,201,392

 

 

$

8,969,405

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

 

 

 

 

 

 

 

 

Fresh Fruit

$

61,511

 

 

$

55,509

 

 

$

38,199

 

 

$

17,491

 

 

$

172,710

 

Diversified Fresh Produce - EMEA

 

14,666

 

 

 

29,134

 

 

 

33,084

 

 

 

28,825

 

 

 

105,709

 

Diversified Fresh Produce - Americas & ROW

 

12,953

 

 

 

16,811

 

 

 

9,631

 

 

 

14,424

 

 

 

53,819

 

Fresh Vegetables

 

8,516

 

 

 

8,431

 

 

 

11,496

 

 

 

11,100

 

 

 

39,543

 

Total

$

97,646

 

 

$

109,885

 

 

$

92,410

 

 

$

71,840

 

 

$

371,781

 

Fresh Fruit

Pro-forma revenue for the fourth quarter increased 6.9% predominantly due to higher pricing of bananas in North America, continued growth in commercial cargo revenues and higher pineapple volumes.

Pro-forma revenue for the full year 2021 increased 2.9% with the benefit of higher banana pricing in North America and higher pineapple pricing in the key North American and European markets and a strong performance from the commercial cargo business throughout the year, partially offset by lower banana volumes in all markets.

Pro-forma Adjusted EBITDA for the fourth quarter decreased 10.3% compared to the prior year. The reduction was predominantly due to inflationary pressures in Europe that were not offset until the pricing was adjusted for new contracts in 2022.

Pro-forma Adjusted EBITDA for the full year 2021 increased 21.6% predominantly due to strong pricing in the North American banana market in the first half of the year and due to the strong performance in the commercial cargo business.

Diversified Fresh Produce – EMEA

Pro-forma revenue and pro-forma Adjusted EBITDA for the fourth quarter increased 4.3% and 1.9%, respectively, primarily as a result of strong trading results across the reporting segment.

Pro-forma revenue for the full year increased 5.4% due to positive currency movements and a strong performance across all channels.

Pro-forma Adjusted EBITDA for the full year increased 24.0%, driven by strong trading across the segment, the continued recovery in food service channels as European governments relaxed COVID-19 measures and the benefit of positive foreign currency translation during the year.

Diversified Fresh Produce – Americas & ROW

Pro-forma revenue for the fourth quarter increased 0.8% and pro-forma revenue for the full year increased 3.8% due to higher revenue from the berry category and growth in the South American export fruit business.

Pro-forma Adjusted EBITDA for the fourth quarter increased 42.6%, driven by a strong start to the Peruvian grape season and the Chilean cherry season.

Pro-forma Adjusted EBITDA for the full year decreased 1.4%, largely due to the impact of adverse weather events that impacted the Chilean grape season at the outset of the year as well as the impact of inflation and logistics challenges for some of our North American businesses. This was offset in part by positive underlying development in the business from continued growth in the berry category, in the Chilean cherry business, in kiwi, and with a recovery in apples and pears after challenges in the prior year.

Fresh Vegetables

Pro-forma revenue for the fourth quarter decreased 8.5% primarily due to lower volumes driven by the impact of the Value Added Salads product recall and temporary plant closures in December.

Pro-forma revenue for the full year 2021 increased 1.0% due to higher pricing in Value Added Salads, partially offset by lower volumes as a consequence of the Value Added Salads product recall and temporary plant closures and lower pricing and volumes in Fresh Packed Vegetables.

Pro-forma Adjusted EBITDA for the fourth quarter decreased 140.7% primarily due to the impact of the Value Added Salads product recall and temporary plant closures as well as a weak end to the year in Fresh Packed Vegetables due to an oversupply in the market.

Following a challenging year, pro-forma Adjusted EBITDA for the full year decreased 101.6% due to the impact of the Value Added Salads product recall and temporary plant closures, significant inflationary pressures in packaging, freight and labor, and persistently weak Fresh Packed Vegetable markets throughout the year.

Capital Expenditures

Pro-forma capital expenditures for the full year 2021 was approximately $190.0 million, including $53.5 million in respect of final payments for two new vessels, Dole Aztec and Dole Maya, which were delivered in the first half of 2021. In addition, $21.4 million was spent reinvesting in Honduran farms impacted by last year’s hurricanes, and $25.4 million in acquiring pineapple assets.

Capital Structure and Financial Leverage

On July 30, 2021 Dole completed its IPO on NYSE, raising net proceeds of $398.9 million. The proceeds raised were used to repay debt within DFC, including $300.0 million of 7.25% Senior Secured Notes. Concurrently with the IPO, the Group also successfully completed a refinancing and syndication of $1.4 billion of new credit facilities, providing the Group with well-structured liquidity to support continued growth. As a result of the IPO and refinancing, the Group has reduced its annual interest expense by over $40.0 million, based on current interest rates.

Net Debt as of December 31, 2021 was $1.1 billion and Financial Leverage was 2.87x.

Outlook for Fiscal Year 2022

For fiscal year 2022, Dole is targeting:

  • Revenue in the range of $9.6 billion to $9.9 billion
  • Adjusted EBITDA in the range of $370.0 million to $380.0 million
  • Capital Expenditures of approximately $125.0 million
  • Net Interest Expense of approximately $45.0 million
  • Effective tax rate in the range of 25.0% to 28.0%

The anticipated reduction in targeted Adjusted EBITDA is primarily due to the significant impact of the Value Added Salads product recalls and temporary plant closures. Additionally, the Group anticipates a negative foreign currency translation impact on translation of Euro earnings to U.S. Dollar.

With the exception of the Value Added Salads business, all other businesses within the group have commenced the year satisfactorily and are trading in line with expectations. However, due to the uncertainty caused by the current geopolitical situation in Ukraine and Russia, it is difficult to accurately predict what impact this may have on global trade flows, cost inflation and foreign exchange rates, and how this might impact the Group over this financial year.

Dividend

On March 14, 2022, the Board of Directors of Dole plc declared a cash dividend for the fourth quarter of 2021 of $0.08 per share, payable on April 12, 2022 to shareholders of record on March 29, 2022.

Consolidated Statement of Operations

 

Year Ended

 

December 31,

2021

 

December 31,

2020

 

Unaudited

 

 

 

(U.S. Dollars and shares in thousands, except per share amounts)

Revenues, net

$

6,454,402

 

 

$

4,345,939

 

Cost of sales

 

(6,105,271

)

 

 

(4,012,348

)

Gross profit

 

349,131

 

 

 

333,591

 

Selling, marketing, general and administrative expenses

 

(349,769

)

 

 

(264,844

)

Merger, transaction and other related costs

 

(30,072

)

 

 

(396

)

Gain on disposal of businesses

 

11

 

 

 

 

Impairment of property, plant and equipment

 

 

 

 

(1,210

)

Gain on asset sales

 

581

 

 

 

 

Operating income (loss)

 

(30,118

)

 

 

67,141

 

Other income (expense), net

 

8,658

 

 

 

(119

)

Interest income

 

3,938

 

 

 

2,604

 

Interest expense

 

(27,030

)

 

 

(10,523

)

Income (loss) before income taxes and equity earnings

 

(44,552

)

 

 

59,103

 

Income tax benefit (expense)

 

13,333

 

 

 

(18,130

)

Equity in net earnings of investments accounted for under the equity method

 

48,027

 

 

 

30,279

 

Net income

 

16,808

 

 

 

71,252

 

Less: Net income attributable to noncontrolling interests

 

(24,027

)

 

 

(18,764

)

Net income (loss) attributable to Dole plc

$

(7,219

)

 

$

52,488

 

 

 

 

 

Net income (loss) per share attributable to Dole plc - basic

$

(0.10

)

 

$

0.95

 

Net income (loss) per share attributable to Dole plc - diluted

$

(0.10

)

 

$

0.94

 

Weighted average shares outstanding - basic

 

72,190

 

 

 

55,509

 

Weighted average shares outstanding - diluted

 

72,190

 

 

 

55,592

 

Revenue and Adjusted EBITDA by reportable segment

 

Year Ended

 

December 31,

2021

 

December 31,

2020

 

Unaudited

 

 

 

(U.S. Dollars in thousands)

Segment Revenue:

 

 

 

Fresh Fruit

$

1,133,038

 

 

$

Diversified Fresh Produce - EMEA

 

3,383,009

 

 

 

3,119,746

Diversified Fresh Produce - Americas & ROW

 

1,465,025

 

 

 

1,226,193

Fresh Vegetables

 

510,687

 

 

 

Total segment revenue

 

6,491,759

 

 

 

4,345,939

Intersegment revenue

 

(37,357

)

 

 

Total consolidated revenue, net

$

6,454,402

 

 

$

4,345,939

 

 

 

 

Segment Adjusted EBITDA:

 

 

 

Net income

$

16,808

 

 

$

71,252

Income tax (benefit) expense

 

(13,333

)

 

 

18,130

Interest expense

 

27,030

 

 

 

10,523

Depreciation

 

61,551

 

 

 

24,634

Amortization of intangible assets

 

11,404

 

 

 

11,548

Merger, transaction and other related costs

 

30,072

 

 

 

396

Net unrealized loss on derivative instruments

 

1,257

 

 

 

633

Net unrealized (gain) on foreign currency denominated borrowings

 

(5,453

)

 

 

Fair value movements on contingent consideration

 

1,036

 

 

 

519

Impairment of property, plant and equipment

 

 

 

 

1,210

Asset write-downs, net of insurance proceeds

 

623

 

 

 

Vegetable recall and related costs

 

17,649

 

 

 

Fair value loss of Legacy Dole acquisition

 

4,023

 

 

 

Fair value (gain) of other acquisitions

 

(7,670

)

 

 

(Gain) on disposal of equity method investments

 

(1,096

)

 

 

(Gain) on disposal of businesses

 

(11

)

 

 

Incremental charges on biological assets and inventory related costs due to acquisition of Legacy Dole

 

65,916

 

 

 

Restructuring costs

 

3,172

 

 

 

Items in earnings for equity method investments:

 

 

 

Dole’s share of depreciation

 

30,390

 

 

 

45,135

Dole’s share of amortization

 

3,218

 

 

 

2,895

Dole’s share of income tax expense

 

27,297

 

 

 

22,329

Dole’s share of interest expense

 

18,282

 

 

 

34,631

Dole’s share of other items

 

(2,039

)

 

 

7,706

Total segment Adjusted EBITDA

$

290,126

 

 

$

251,541

 

 

 

 

Fresh Fruit

$

26,965

 

 

$

Diversified Fresh Produce - EMEA

 

128,098

 

 

 

105,089

Diversified Fresh Produce - Americas & ROW

 

41,737

 

 

 

32,335

Fresh Vegetables

 

(27

)

 

 

Legacy Dole

 

93,353

 

 

 

114,117

Total segment Adjusted EBITDA

$

290,126

 

 

$

251,541

Consolidated Balance Sheets

 

December 31,

2021

 

December 31,

2020

 

Unaudited

 

 

ASSETS

(U.S. Dollars in thousands)

Cash and cash equivalents

$

250,561

 

 

$

160,503

 

Short-term investments

 

6,115

 

 

 

 

Trade receivables, net of allowances for credit losses of $22,064 and $10,122, respectively

 

719,114

 

 

 

361,721

 

Grower advance receivables, net of allowances of $9,606 and $5,598, respectively

 

72,350

 

 

 

18,946

 

Other receivables, net of allowances of $14,066 and $2,850, respectively

 

125,908

 

 

 

28,540

 

Inventories, net of allowances of $7,447 and $0, respectively

 

410,737

 

 

 

141,179

 

Prepaid expenses

 

45,339

 

 

 

16,570

 

Other current assets

 

11,011

 

 

 

2,936

 

Assets held-for-sale

 

200

 

 

 

 

Total current assets

 

1,641,335

 

 

 

730,395

 

Long-term investments

 

23,433

 

 

 

 

Investments in unconsolidated affiliates

 

128,407

 

 

 

458,557

 

Actively marketed property

 

50,364

 

 

 

 

Property, plant and equipment, net of accumulated depreciation of $283,677 and $160,111, respectively

 

1,430,850

 

 

 

219,665

 

Operating lease right-of-use assets

 

368,632

 

 

 

140,212

 

Goodwill

 

511,333

 

 

 

234,161

 

DOLE brand

 

306,280

 

 

 

 

Other intangible assets, net of accumulated amortization of $117,499 and $119,576 respectively

 

62,046

 

 

 

65,634

 

Other assets

 

98,917

 

 

 

30,496

 

Deferred income tax assets

 

46,371

 

 

 

6,682

 

Total assets

$

4,667,968

 

 

$

1,885,802

 

LIABILITIES AND EQUITY

 

 

 

Accounts payable

$

696,766

 

 

$

474,528

 

Income taxes payable

 

10,316

 

 

 

2,589

 

Accrued liabilities

 

464,931

 

 

 

123,463

 

Bank overdrafts

 

9,395

 

 

 

11,243

 

Notes payable and current portion of long-term debt, net

 

51,785

 

 

 

20,748

 

Current maturities of operating leases

 

73,046

 

 

 

21,910

 

Other tax

 

35,212

 

 

 

23,371

 

Contingent consideration

 

2,958

 

 

 

4,912

 

Pension and postretirement benefits

 

17,664

 

 

 

5,787

 

Dividends payable and current liabilities

 

9,078

 

 

 

1,355

 

Total current liabilities

 

1,371,151

 

 

 

689,906

 

Long-term debt, net

 

1,297,808

 

 

 

314,840

 

Operating leases, less current maturities

 

305,714

 

 

 

122,225

 

Deferred income tax liabilities

 

145,689

 

 

 

22,451

 

Income tax payable, less current portion

 

40,439

 

 

 

 

Contingent consideration, less current portion

 

4,302

 

 

 

5,786

 

Pension and postretirement benefits, less current portion

 

152,149

 

 

 

23,607

 

Other long-term liabilities

 

105,310

 

 

 

18,755

 

Total liabilities

$

3,422,562

 

 

$

1,197,570

 

Commitments and contingent liabilities:

 

 

 

Redeemable noncontrolling interests

 

32,776

 

 

 

30,317

 

Stockholders’ equity:

 

 

 

Common stock—$0.001 par value; 300,000,000 shares authorized and 94,877,706 shares outstanding as of December 31, 2021 and 1,000,000,000 shares authorized and 410,724,962 shares outstanding as of December 31, 2020

 

950

 

 

 

4,865

 

Additional paid-in capital

 

792,223

 

 

 

198,232

 

Retained earnings

 

413,335

 

 

 

460,715

 

Accumulated other comprehensive loss

 

(125,919

)

 

 

(128,803

)

Total equity attributable to Dole plc

 

1,080,589

 

 

 

535,009

 

Equity attributable to noncontrolling interests

 

132,041

 

 

 

122,906

 

Total equity

 

1,212,630

 

 

 

657,915

 

Total liabilities, redeemable noncontrolling interests and equity

$

4,667,968

 

 

$

1,885,802

 

Pro-forma Financial Statements

Pro-forma Methodology

The methodology used to prepare the unaudited pro-forma consolidated financial statements for Dole plc to show the estimated effects of the acquisition of DFC by TP and the IPO and refinancing as if they had occurred on January 1, 2020, is in line with how the pro-forma financial statements were prepared in the F-1.

  1. All associated transaction costs reflected on January 1, 2020.
  2. Effective tax rate for 2020 (28.5%) and 2021 (26.0%).
  3. Applying the results of the Purchase Price Allocation (“PPA”) exercise, acquisition accounting and debt refinancing to January 1, 2020:
    1. Reversal of fair value uplift to banana and pineapple inventory and bearer plants. DFC accounts for agricultural costs in accordance with ASC 905, Agriculture for all crops except pineapples and bananas due to their continuous cycle of production. At the acquisition balance sheet date previously uncapitalized pineapple and banana costs are required to be recognized at their fair value to reflect the biological transformation of these crops. This is an uplift of $35.0 million in relation to inventory and $68.0 million in relation to pineapple bearer plants. These fair value uplifts will be amortized in the income statement over the remaining growth and harvest cycle for the inventory element and over the life of the plants for the bearer plants. The pro-forma results include the full reversal of these amounts, or $103.0 million, based on the life of the plants.
    2. 2020 and 2021 pro-forma results reflect a reduction in the depreciation charge of $4.0 million. This is a function of the asset values increasing as a result of the PPA exercise offset by an increase in the estimated useful lives of the assets.
    3. The interest expense for both years reflects the outcome of the refinancing.
    4. Fair value loss on TP’s investment in DFC recorded on January 1, 2020.
  4. TP’s pickup of its 45.0% share of DFC’s net income has been eliminated.
  5. EPS is calculated using shares in issue following the IPO and additional share issuances.
  6. There is an adjustment in 2020 of $14.0 million and an adjustment in 2021 of $9.8 million to reflect estimated ongoing incremental public company costs of $14.0 million annualized.

Pro-forma Statement of Operations (Unaudited) – for the quarters ended December 31, 2021 and 2020

 

Quarter Ended

December 31,

2021

 

Quarter Ended

December 31,

2020

 

(U.S. Dollars in thousands, except per share amounts)

Revenues, net

$

2,251,480

 

 

$

2,201,392

 

Cost of sales

 

(2,115,837

)

 

 

(2,056,492

)

Gross profit

 

135,643

 

 

 

144,900

 

Selling, marketing and general and administrative expenses

 

(134,374

)

 

 

(120,998

)

Gain on disposal of businesses

 

606

 

 

 

 

Gain on asset sales

 

(9,058

)

 

 

3,338

 

Operating income (expense)

 

(7,183

)

 

 

27,240

 

Other income (expense), net

 

760

 

 

 

(18,210

)

Interest income

 

2,112

 

 

 

1,817

 

Interest expense

 

(11,135

)

 

 

(11,135

)

Loss from continuing operations before income taxes and equity earnings

 

(15,446

)

 

 

(288

)

Income tax benefit (expense)

 

9,882

 

 

 

(1,727

)

Equity in net earnings of investments accounted for under the equity method

 

6,061

 

 

 

5,413

 

Income from continuing operations, net of income taxes

 

497

 

 

 

3,398

 

 

 

 

 

Net income

 

497

 

 

 

3,398

 

Less: Net income attributable to noncontrolling interests

 

(4,675

)

 

 

(3,552

)

Net (loss) attributable to Dole plc

$

(4,178

)

 

$

(154

)

 

 

 

 

Net (loss) per share attributable to Dole plc - basic

$

(0.04

)

 

$

0.00

 

Net (loss) per share attributable to Dole plc - diluted

$

(0.04

)

 

$

0.00

 

Weighted average shares outstanding - basis

 

94,878

 

 

 

94,878

 

Weighted average shares outstanding - diluted

 

95,030

 

 

 

95,030

 

Pro-forma Statement of Operations (Unaudited) – for the years ended December 31, 2021 and 2020

 

Year Ended

December 31,

2021

 

Year Ended

December 31,

2020

 

(U.S. Dollars in thousands, except per share amounts)

Revenues, net

$

9,285,672

 

 

$

8,969,405

 

Cost of sales

 

(8,565,685

)

 

 

(8,373,252

)

Gross profit

 

719,987

 

 

 

596,153

 

Selling, marketing and general and administrative expenses

 

(517,712

)

 

 

(479,030

)

Merger, transaction and other related costs

 

 

 

 

(31,933

)

Gain on disposal of businesses

 

11

 

 

 

 

Impairment of property, plant & equipment

 

 

 

 

(1,210

)

Gain on asset sales

 

3,323

 

 

 

11,181

 

Operating income

 

205,609

 

 

 

95,161

 

Other income (expense), net

 

20,572

 

 

 

(29,820

)

Interest income

 

5,321

 

 

 

5,735

 

Interest expense

 

(45,520

)

 

 

(45,520

)

Income from continuing operations before income taxes and equity earnings

 

185,982

 

 

 

25,556

 

Income tax expense

 

(32,089

)

 

 

(9,622

)

Equity in net earnings of investments accounted for under the equity method

 

23,658

 

 

 

13,294

 

Income from continuing operations, net of income taxes

 

177,551

 

 

 

29,228

 

Loss from discontinued operations, net of income taxes

 

 

 

 

(43

)

Net income

 

177,551

 

 

 

29,185

 

Less: Net income attributable to noncontrolling interests

 

(25,900

)

 

 

(20,618

)

Net income attributable to Dole plc

$

151,651

 

 

$

8,567

 

 

 

 

 

Net income per share attributable to Dole plc - basic

$

1.60

 

 

$

0.09

 

Net income per share attributable to Dole plc - diluted

$

1.60

 

 

$

0.09

 

Weighted average share outstanding - basic

 

94,878

 

 

 

94,878

 

Weighted average shares outstanding - diluted

 

95,030

 

 

 

95,030

 

Reconciliation from Pro-forma Net Income to Pro-forma Adjusted EBITDA (Unaudited) – for the quarters ended December 31, 2021 and 2020

 

Quarter Ended

December 31,

2021

 

Quarter Ended

December 31,

2020

 

(U.S. Dollars in thousands)

 

 

 

 

Net income

$

497

 

 

$

3,398

 

Interest expense from continuing operations

 

11,135

 

 

 

11,135

 

Income tax (benefit) expense from continuing operations

 

(9,882

)

 

 

1,727

 

EBIT

 

1,750

 

 

 

16,260

 

Depreciation

 

26,595

 

 

 

29,129

 

Amortization of intangible assets

 

3,168

 

 

 

2,936

 

Net unrealized loss (gain) on derivative instruments

 

1,016

 

 

 

(4,953

)

Fair value movement on contingent consideration

 

(94

)

 

 

1,213

 

Net unrealized (gain) loss on foreign currency denominated borrowings

 

(2,222

)

 

 

10,015

 

Restructuring charges and onerous contract costs

 

3,547

 

 

 

(249

)

Incremental charges on biological assets and inventory related costs due to acquisition of Legacy Dole

 

 

 

 

17,021

 

Loss (gain) on asset sales

 

9,469

 

 

 

(4,488

)

(Gain) on disposal of businesses

 

(606

)

 

 

 

Fair value loss of other acquisitions

 

239

 

 

 

 

Insurance proceeds, asset write-downs and disposals, net

 

888

 

 

 

1,484

 

Produce recall costs

 

17,649

 

 

 

 

Items in earnings for equity method investments:

 

 

 

Dole's share of interest expense

 

208

 

 

 

266

 

Dole's share of income tax

 

(244

)

 

 

1,162

 

Dole's share of depreciation

 

1,172

 

 

 

1,287

 

Dole's share of amortization

 

756

 

 

 

757

 

Dole's share of other items

 

(2,180

)

 

 

 

Adjusted EBITDA

$

61,111

 

 

$

71,840

 

Reconciliation from Pro-forma Net Income to Pro-forma Adjusted EBITDA (Unaudited) – for the years ended December 31, 2021 and 2020

 

Year Ended

December 31,

2021

 

Year Ended

December 31,

2020

 

(U.S. Dollars in thousands)

Net income

$

177,551

 

 

$

29,185

 

Loss from discontinued operations, net of income taxes

 

 

 

 

43

 

Interest expense from continuing operations

 

45,520

 

 

 

45,520

 

Income tax expense from continuing operations

 

32,089

 

 

 

9,622

 

EBIT

 

255,160

 

 

 

84,370

 

Depreciation

 

113,276

 

 

 

111,294

 

Amortization of intangible assets

 

11,404

 

 

 

11,548

 

Net unrealized loss (gain) on derivative instruments

 

3,307

 

 

 

(11,296

)

Fair value movement on contingent consideration

 

1,036

 

 

 

519

 

Merger, transaction and other related costs

 

 

 

 

31,933

 

Impairment of property, plant & equipment

 

 

 

 

1,210

 

Net unrealized (gain) loss on foreign currency denominated borrowings

 

(9,478

)

 

 

20,126

 

Restructuring charges and onerous contract costs

 

3,172

 

 

 

929

 

Incremental charges on biological assets and inventory related costs due to acquisition of Legacy Dole

 

 

 

 

103,267

 

Loss (gain) on asset sales

 

177

 

 

 

(12,137

)

(Gain) on disposal of businesses

 

(11

)

 

 

 

Fair value loss of Legacy Dole acquisition

 

 

 

 

4,023

 

Fair value (gain) of other acquisitions

 

(7,670

)

 

 

 

COVID-19

 

 

 

 

10,877

 

(Gain) on disposal of equity method investments

 

(1,096

)

 

 

 

Insurance proceeds, assets write-downs and disposals, net

 

(18,494

)

 

 

1,428

 

Produce recall costs

 

17,649

 

 

 

 

Legal matters

 

14,610

 

 

 

 

Items in earnings for equity method investments:

 

 

 

Dole's share of interest expense

 

1,321

 

 

 

1,400

 

Dole's share of income tax

 

2,930

 

 

 

4,027

 

Dole's share of depreciation

 

5,249

 

 

 

5,369

 

Dole's share of amortization

 

3,218

 

 

 

2,894

 

Dole's share of other items

 

(2,180

)

 

 

 

Adjusted EBITDA

$

393,580

 

 

$

371,781

 

Reconciliation from Pro-forma Net Income to Pro-forma Adjusted Net Income (Unaudited) – for the quarters ended December 31, 2021 and 2020

 

Quarter Ended

December 31,

2021

 

Quarter Ended

December 31,

2020

 

(U.S. Dollars in thousands)

 

 

 

 

(Loss) for the financial year attributable to equity shareholders

$

(4,178

)

 

$

(154

)

Adjustments:

 

 

 

Amortization of intangible assets

 

3,168

 

 

 

2,936

 

Net unrealized loss (gain) on derivative financial instruments

 

1,016

 

 

 

(4,953

)

Fair value movements on contingent consideration

 

(94

)

 

 

1,213

 

Restructuring charges and onerous contract costs

 

3,547

 

 

 

(249

)

(Gain) on disposal of businesses

 

(606

)

 

 

 

Loss (gain) on asset sales

 

9,469

 

 

 

(4,488

)

Fair value loss on other acquisitions

 

239

 

 

 

 

Incremental charges on biological assets and inventory related costs due to acquisition of Legacy Dole

 

 

 

 

17,021

 

Produce recall costs

 

17,649

 

 

 

 

Insurance proceeds, asset write-downs and disposals, net

 

888

 

 

 

1,484

 

Net unrealized (gain) loss on foreign currency denominated borrowings

 

(2,222

)

 

 

10,015

 

Income tax (benefit) on items above

 

(4,969

)

 

 

(6,638

)

Income tax (benefit) expense on discrete tax items

 

(7,881

)

 

 

1,809

 

NCI impact on items above

 

(972

)

 

 

(724

)

Items in earnings for equity method investments

 

 

 

Dole's share of amortization on intangible assets

 

756

 

 

 

757

 

Dole's share of other items

 

(2,180

)

 

 

 

Dole's share of income tax (benefit) on items above

 

(120

)

 

 

(27

)

Adjusted earnings for EPS calculation

$

13,510

 

 

$

18,002

 

 

 

 

 

Weighted average number of shares at end of period ('000)

 

94,878

 

 

 

94,878

 

Adjusted basic earnings per share

$

0.14

 

 

$

0.19

 

Diluted weighted average number of shares ('000)

 

95,030

 

 

 

95,030

 

Adjusted fully diluted earnings per share

$

0.14

 

 

$

0.19

 

Reconciliation from Pro-forma Net Income to Pro-forma Adjusted Net Income (Unaudited) – for the years ended December 31, 2021 and 2020

 

Year Ended

December 31,

2021

 

Year Ended

December 31,

2020

 

(U.S. Dollars in thousands)

 

 

 

 

Profit for the financial year attributable to equity shareholders

$

151,651

 

 

$

8,567

 

Adjustments:

 

 

 

Amortization of intangible assets

 

11,404

 

 

 

11,548

 

Net unrealized loss (gain) on derivative financial instruments

 

3,307

 

 

 

(11,296

)

Fair value movements on contingent consideration

 

1,036

 

 

 

519

 

Restructuring charges and onerous contract costs

 

3,172

 

 

 

929

 

(Gain) on disposal of businesses

 

(11

)

 

 

 

Loss (gain) on asset sales

 

177

 

 

 

(12,137

)

Fair value gain on other acquisitions

 

(7,670

)

 

 

 

Legal matters

 

14,610

 

 

 

 

COVID-19

 

 

 

 

10,877

 

Merger, transaction and other related costs

 

 

 

 

31,933

 

Impairment of property, plant & equipment

 

 

 

 

1,210

 

Incremental charges on biological assets and inventory related costs due to acquisition of Legacy Dole

 

 

 

 

103,267

 

Produce recall costs

 

17,649

 

 

 

 

Insurance proceeds, asset write-downs and disposals, net

 

(18,494

)

 

 

1,428

 

Net unrealized (gain) loss on foreign currency denominated borrowings

 

(9,478

)

 

 

20,126

 

Fair value loss of Legacy Dole acquisition

 

 

 

 

4,023

 

(Gain) on disposal of equity method investments

 

(1,096

)

 

 

 

Income tax (benefit) on items above

 

(5,579

)

 

 

(37,745

)

Income tax (benefit) on discrete tax items

 

(16,267

)

 

 

(5,926

)

NCI impact on items above

 

(3,738

)

 

 

(3,544

)

Items in earnings for equity method investments

 

 

 

Dole's share of intangible asset amortization

 

3,218

 

 

 

2,894

 

Dole share of other items

 

(2,180

)

 

 

 

Dole's share of income tax (benefit) on items above

 

(514

)

 

 

(377

)

Adjusted earnings for EPS calculation

$

141,197

 

 

$

126,296

 

 

 

 

 

Weighted average number of shares at end of period ('000)

 

94,878

 

 

 

94,878

 

Adjusted basic earnings per share

$

1.49

 

 

$

1.33

 

Diluted weighted average number of shares ('000)

 

95,030

 

 

 

95,030

 

Adjusted fully diluted earnings per share

$

1.49

 

 

$

1.33

 

Pro-forma Reconciliation (Unaudited) – for the full year ended December 31, 2021

 

TP

DFC

Dole plc

FV &

Intercompany

Adjustment

Transaction

Costs

Ongoing

plc Costs

Debt

Adjustment

Tax

Adjustment

Pro-forma

Financial

Statements

 

(U.S. Dollars in thousands)

Revenues, net

4,548,888

 

4,809,173

 

9,358,061

 

(72,389

)

 

 

 

9,285,672

 

Cost of sales

(4,179,155

)

(4,537,683

)

(8,716,838

)

151,153

 

 

 

 

(8,565,685

)

Gross profit

369,733

 

271,490

 

641,223

 

78,764

 

 

 

 

719,987

 

Selling, marketing and general and administrative expenses

(290,047

)

(217,915

)

(507,962

)

 

(9,750

)

 

 

(517,712

)

Merger, transaction and other related costs

(26,719

)

(5,214

)

(31,933

)

 

31,933

 

 

 

 

Gain on disposal of businesses

11

 

 

11

 

 

 

 

 

11

 

Gain on asset sales

581

 

7,372

 

7,953

 

(4,630

)

 

 

 

3,323

 

Operating income (expense), net

53,559

 

55,733

 

109,292

 

74,134

 

31,933

(9,750

)

 

 

205,609

 

Other income (expense), net

1,557

 

19,015

 

20,572

 

 

 

 

 

20,572

 

Interest income

2,594

 

2,727

 

5,321

 

 

 

 

 

5,321

 

Interest expense

(21,912

)

(44,790

)

(66,702

)

 

 

21,182

 

 

(45,520

)

Income (loss) before income taxes and equity earnings

35,798

 

32,685

 

68,483

 

74,134

 

31,933

(9,750

)

21,182

 

 

185,982

 

Income tax (expense) benefit

(20,018

)

(30,787

)

(50,805

)

 

3,066

 

(6,660

)

22,310

 

(32,089

)

Equity in net earnings of investments accounted for under the equity method

46,317

 

1,737

 

48,054

 

(24,396

)

 

 

 

23,658

 

Income from continuing operations, net of income taxes

62,097

 

3,635

 

65,732

 

49,738

 

31,933

(6,684

)

14,522

 

22,310

 

177,551

 

Income from discontinued operations, net of income taxes

 

 

 

 

 

 

 

 

Net income (loss)

62,097

 

3,635

 

65,732

 

49,738

 

31,933

(6,684

)

14,522

 

22,310

 

177,551

 

Less: Net income attributable to noncontrolling interests

(23,004

)

(2,896

)

(25,900

)

 

 

 

 

(25,900

)

Net income (loss) attributable to Dole plc

39,093

 

739

 

39,832

 

49,738

 

31,933

(6,684

)

14,522

 

22,310

 

151,651

 

 

 

 

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

 

 

 

 

Net income per share - basic

 

 

 

 

 

 

 

 

$

1.60

 

Net income per share - diluted

 

 

 

 

 

 

 

 

$

1.60

 

Weighted average shares outstanding

 

 

 

 

 

 

 

 

 

Basic

 

 

 

 

 

 

 

 

 

94,878

 

Diluted

 

 

 

 

 

 

 

 

 

95,030

 

Pro-forma Reconciliation (Unaudited) – for the full year ended December 31, 2020

 

TP

DFC

Dole plc

FV &

Intercompany

Adjustment

Transaction

Costs

Ongoing

plc Costs

Debt

Adjustment

Tax

Adjustment

Pro-forma

Financial

Statements

 

(U.S. Dollars in thousands)

Revenues, net

4,345,939

 

4,671,999

 

9,017,938

 

(48,533

)

 

 

 

 

8,969,405

 

Cost of sales

(4,012,348

)

(4,311,275

)

(8,323,623

)

(49,629

)

 

 

 

 

(8,373,252

)

Gross profit

333,591

 

360,724

 

694,315

 

(98,162

)

 

 

 

 

596,153

 

Selling, marketing and general and administrative expenses

(264,448

)

(200,582

)

(465,030

)

 

 

(14,000

)

 

 

(479,030

)

Merger, transaction and other related costs

(396

)

(661

)

(1,057

)

 

(30,876

)

 

 

 

(31,933

)

Impairment of property, plant & equipment

(1,210

)

 

(1,210

)

 

 

 

 

 

(1,210

)

Gain on asset sales

 

11,181

 

11,181

 

 

 

 

 

 

11,181

 

Operating income (loss)

67,537

 

170,662

 

238,199

 

(98,162

)

(30,876

)

(14,000

)

 

 

95,161

 

Other income (expense), net

(515

)

(29,305

)

(29,820

)

 

 

 

 

 

(29,820

)

Interest income

2,604

 

3,131

 

5,735

 

 

 

 

 

 

5,735

 

Interest expense

(10,523

)

(78,250

)

(88,773

)

 

 

 

43,253

 

 

(45,520

)

Income (loss) from continuing operations before income taxes and equity earnings

59,103

 

66,238

 

125,341

 

(98,162

)

(30,876

)

(14,000

)

43,253

 

 

25,556

 

Income tax (provision) benefit

(18,130

)

(23,782

)

(41,912

)

 

 

4,402

 

(13,600

)

41,488

 

(9,622

)

Equity in net earnings of investments accounted for under the equity method

30,279

 

2,149

 

32,428

 

(19,134

)

 

 

 

 

13,294

 

Income from continuing operations, net of income taxes

71,252

 

44,605

 

115,857

 

(117,296

)

(30,876

)

(9,598

)

29,653

 

41,488

 

29,228

 

Loss from discontinued operations, net of income taxes

 

(43

)

(43

)

 

 

 

 

 

(43

)

Net income (loss)

71,252

 

44,562

 

115,814

 

(117,296

)

(30,876

)

(9,598

)

29,653

 

41,488

 

29,185

 

Less: Net income attributable to noncontrolling interests

(18,764

)

(1,854

)

(20,618

)

 

 

 

 

 

(20,618

)

Net income (loss) attributable to Dole plc

52,488

 

42,708

 

95,196

 

(117,296

)

(30,876

)

(9,598

)

29,653

 

41,488

 

8,567

 

 

 

 

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

 

 

 

 

Net income (loss) per share - basic

 

 

 

 

 

 

 

 

$

0.09

 

Net income (loss) per share - diluted

 

 

 

 

 

 

 

 

$

0.09

 

Weighted average shares outstanding

 

 

 

 

 

 

 

 

 

Basic

 

 

 

 

 

 

 

 

$

94,878

 

Diluted

 

 

 

 

 

 

 

 

$

95,030

 

Quarterly Pro-forma Financial Information (Unaudited)

 

Q1'21

 

Q2'21

 

Q3'21

 

Q4'21

 

FY'21

 

(U.S. Dollars in thousands)

Pro-forma Revenue

$

2,265,763

 

$

2,462,392

 

$

2,306,037

 

$

2,251,480

 

 

$

9,285,672

Pro-forma Adjusted EBITDA

 

131,144

 

 

143,275

 

 

58,050

 

 

61,111

 

 

 

393,580

Pro-forma Earnings per Share

$

0.62

 

$

0.75

 

$

0.32

 

$

(0.04

)

 

$

1.60

Pro-forma Adjusted Earnings per Share

$

0.63

 

$

0.71

 

$

0.04

 

$

0.14

 

 

$

1.49

 

Q1'20

 

Q2'20

 

Q3'20

 

Q4'20

 

FY'20

 

(U.S. Dollars in thousands)

Pro-forma Revenue

$

2,179,718

 

 

$

2,278,322

 

$

2,309,973

 

$

2,201,392

 

$

8,969,405

Pro-forma Adjusted EBITDA

 

97,646

 

 

 

109,885

 

 

92,410

 

 

71,840

 

 

371,781

Pro-forma Earnings per Share

$

(0.39

)

 

$

0.29

 

$

0.20

 

$

0.00

 

$

0.09

Pro-forma Adjusted Earnings per Share

$

0.44

 

 

$

0.37

 

$

0.32

 

$

0.19

 

$

1.33

Net Debt and Financial Leverage

Net Debt is the primary measure used by management to analyze the Company’s capital structure and financial leverage. Net Debt is a non-GAAP financial measure, calculated as cash and cash equivalents, less current and long-term debt. It also excludes debt discounts and debt issuance costs. The calculation of Net Debt and financial leverage as of December 31, 2021 is presented below. Net Debt as of December 31, 2021 was $1.1 billion and financial leverage was 2.87x.

 

December 31, 2021

 

Unaudited

 

(U.S. Dollars in thousands)

Cash and cash equivalents

$

(250,561

)

Bank overdrafts

 

9,395

 

Notes payable and current portion of long-term debt, net

 

51,785

 

Long-term debt, net

 

1,297,808

 

 

 

1,108,427

 

Less: Debt discounts and debt issuance costs

 

21,063

 

Net Debt

$

1,129,490

 

 

 

Pro-forma Adjusted EBITDA

 

393,580

 

Financial Leverage: Net Debt / Pro-forma Adjusted EBITDA

2.87x

The following tables reconcile revenue to pro-forma revenue and Adjusted EBITDA to pro-forma Adjusted EBITDA for the quarters and years ended December 31, 2021 and 2020:

 

Quarter Ended

December 31,

2021

 

Quarter Ended

December 31,

2020

 

Unaudited

 

(U.S. Dollars in thousands)

Revenue

$

2,251,480

 

$

1,054,655

 

Incremental revenue of 100% of DFC3

 

 

 

1,158,870

 

Effect of intercompany transactions in period

 

 

 

(12,133

)

Pro-forma Revenue

$

2,251,480

 

$

2,201,392

 

 

Year Ended

December 31,

2021

 

Year Ended

December 31,

2020

 

Unaudited

 

(U.S. Dollars in thousands)

Revenue

$

6,454,402

 

 

$

4,345,939

 

Incremental revenue of 100% of DFC3

 

2,875,099

 

 

 

4,671,999

 

Effect of intercompany transactions in period

 

(43,829

)

 

 

(48,533

)

Pro-forma Revenue

$

9,285,672

 

 

$

8,969,405

 

 

Quarter Ended

December 31,

2021

 

Quarter Ended

December 31,

2020

 

Unaudited

 

(U.S. Dollars in thousands)

Adjusted EBITDA

$

61,111

 

$

54,470

 

Less EBITDA of equity accounted 45% of DFC

 

 

 

(18,358

)

Incremental EBITDA of 100% of DFC3

 

 

 

39,228

 

Pro-forma public company costs

 

 

 

(3,500

)

Pro-forma Adjusted EBITDA

$

61,111

 

$

71,840

 

 

Year Ended

December 31,

2021

 

Year Ended

December 31,

2020

 

Unaudited

 

(U.S. Dollars in thousands)

Adjusted EBITDA

$

290,126

 

 

$

251,541

 

Less EBITDA of equity accounted 45% of DFC

 

(93,353

)

 

 

(114,117

)

Incremental EBITDA of 100% of DFC3

 

206,557

 

 

 

248,357

 

Pro-forma public company costs

 

(9,750

)

 

 

(14,000

)

Pro-forma Adjusted EBITDA

$

393,580

 

 

$

371,781

 

_______________________________

3 Incremental revenue and EBITDA from DFC relates to periods from January 1, 2021, to July 29, 2021, and January 1, 2020, to December 31, 2020, respectively.

Dole plc’s results are determined in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”).

In addition to its results under GAAP, in this Press Release we also present Dole plc’s Adjusted EBITDA, pro-forma EBIT, pro-forma Adjusted EBITDA, pro-forma Adjusted net income attributable to Dole plc and pro-forma Adjusted Earnings per Share, which are supplemental measures of financial performance that are not required by, or presented in accordance with, GAAP.

Adjusted EBITDA is calculated from EBIT before discontinued operations by: (1) adding depreciation charges; (2) adding amortization charges; (3) adding merger, transaction and other related costs; (4) adding the net unrealized loss or subtracting the net unrealized gain on derivative instruments;(5) adding the net unrealized loss or subtracting the net unrealized gain on foreign denominated borrowings; (6) adding the net realized loss or subtracting the net realized gain on noncash settled foreign denominated intercompany borrowings; (7) adding or subtracting fair value movements on contingent consideration; (8) adding impairment charges on property, plant and equipment; (9) adding or subtracting asset write-downs, net of insurance proceeds; (10) adding incremental costs for produce recalls and related costs; (11) subtracting the fair value gain or adding the fair value loss on the acquisition of investments previously accounted for under the equity method; (12) subtracting the gain or adding the loss on the sale of investments accounted for under the equity method; (13) subtracting the gain or adding the loss on the disposal of business interests; (14) adding the loss or subtracting the gain on asset sales for assets held-for-sale and actively marketed property; (15) adding the incremental costs from the fair value uplift for biological assets and inventory related to the acquisition of Legacy Dole; (16) adding restructuring charges; (17) adding costs for legal matters not in the ordinary course of business; and (18) adding costs that are directly related to the COVID-19 pandemic, and are as follows: costs that are (i) incremental to charges incurred prior to the outbreak, (ii) not expected to recur once the crisis has subsided and operations return to normal, and (iii) clearly separable from normal operations. Costs related to COVID-19 are not added back after the fourth quarter of 2020. It also includes the effect of the Company’s share of all listed items within investments accounted for under the equity method.

Pro-forma EBIT before discontinued operations is calculated from pro-forma net income (loss) by adding pro-forma interest expense from continuing operations, adding the pro-forma income tax expense or subtracting the pro-forma income tax benefit from continuing operations, and adding any applicable pro-forma net loss from discontinued operations.

Pro-forma Adjusted EBITDA is calculated from pro-forma EBIT before discontinued operations by: (1) adding depreciation charges; (2) adding amortization charges; (3) adding merger, transaction and other related costs; (4) adding the net unrealized loss or subtracting the net unrealized gain on derivative instruments; (5) adding the net unrealized loss or subtracting the net unrealized gain on foreign denominated borrowings; (6) adding the net realized loss or subtracting the net realized gain on noncash settled foreign denominated intercompany borrowings; (7) adding or subtracting fair value movements on contingent consideration; (8) adding impairment charges on property, plant and equipment; (9) adding or subtracting asset write-downs, net of insurance proceeds; (10) adding incremental costs for produce recalls and related costs; (11) subtracting the fair value gain or adding the fair value loss on the acquisition of investments previously accounted for under the equity method; (12) subtracting the gain or adding the loss on the sale of investments accounted for under the equity method; (13) subtracting the gain or adding the loss on the disposal of business interests; (14) adding the loss or subtracting the gain on asset sales for assets held-for-sale and actively marketed property; (15) adding the incremental costs from the fair value uplift for biological assets and inventory related to the acquisition of Legacy Dole; (16) adding restructuring charges; (17) adding costs for legal matters not in the ordinary course of business; and (18) adding costs that are directly related to the COVID-19 pandemic, and are as follows: costs that are (i) incremental to charges incurred prior to the outbreak, (ii) not expected to recur once the crisis has subsided and operations return to normal, and (iii) clearly separable from normal operations. Costs related to COVID-19 are not added back after the fourth quarter of 2020. It also includes the effect of the Company’s share of all listed items within investments accounted for under the equity method.

Pro-forma Adjusted Net Income attributable to Dole plc is calculated from pro-forma net income (loss) attributable to Dole plc by: (1) adding the loss from discontinued operations, net of income tax; (2) adding intangible asset amortization charges; (3) adding merger, transaction and other related costs; (4) adding net unrealized loss or subtracting the net unrealized gain on derivative instruments including interest rate swaps; (5) adding the net unrealized loss or subtracting the net unrealized gain on foreign denominated borrowings; (6) adding the net realized loss or subtracting the net realized gain on noncash settled foreign denominated intercompany borrowings; (7) adding or subtracting fair value movements on contingent consideration; (8) adding impairment charges on property, plant and equipment; (9) adding or subtracting asset write-downs, net of insurance proceeds; (10) adding incremental costs for produce recalls and related costs; (11) subtracting the fair value gain or adding the fair value loss on the acquisition of investments previously accounted for under the equity method; (12) subtracting the gain or adding the loss on the sale of investments accounted for under the equity method; (13) subtracting the gain or adding the loss on the disposal of business interests; (14) adding the loss or subtracting the gain on asset sales for assets held-for-sale and actively marketed property; (15) adding the incremental costs from the fair value uplift for biological assets and inventory related to the acquisition of Legacy Dole; (16) adding restructuring charges; (17) adding costs for legal matters not in the ordinary course of business; (18) adding back the expense or subtracting the benefit of U.S. Tax Reform discrete income tax expense (benefit); and (19) adding costs that are directly related to the COVID-19 pandemic, and are as follows: (i) incremental to charges incurred prior to the outbreak, including incremental costs related to personal protective equipment and transportation, and direct costs due to lower production capacity from a plant shutdown, (ii) not expected to recur once the crisis has subsided and operations return to normal, and (iii) clearly separable from normal operations. Costs related to COVID-19 are not added back after the fourth quarter of 2020. It also excludes the tax effect and the effect attributable to non-controlling interests share of such items. It also includes the effect of the Company’s share of all listed items within investments accounted for under the equity method.

Pro-forma Adjusted Earnings per Share is calculated from pro-forma Adjusted Net Income attributable to Dole plc divided by diluted weighted average number of shares in the applicable period.

Pro-forma EBIT before discontinued operations, Adjusted EBITDA, pro-forma Adjusted EBITDA, and pro-forma Adjusted Net Income attributable to Dole plc are not measurements of Dole plc financial performance under GAAP and should not be considered as alternatives to net income attributable to Dole plc, net income, income (loss) from continuing operations or any other performance measures derived in accordance with GAAP. Additionally, pro-forma EBIT before discontinued operations and pro-forma Adjusted EBITDA are not intended to be liquidity measures because of certain limitations such as:

  • They do not reflect Dole plc’s cash expenditures, or future requirements, for capital expenditures or contractual commitments;
  • They do not reflect changes in, or cash requirements for, Dole plc’s working capital needs;
  • They do not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on Dole plc’s debt; and
  • Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and these non-GAAP measures do not reflect cash requirements for such replacements.

Because of these limitations, pro-forma EBIT before discontinued operations and pro-forma Adjusted EBITDA should not be considered as measures of discretionary cash available to Dole plc to invest in the growth of its and Dole plc’s business.

Further, pro-forma EBIT before discontinued operations, pro-forma Adjusted EBITDA, and pro-forma Adjusted Net Income attributable to Dole plc as used herein may not be calculated in a similar manner to, and are therefore not necessarily comparable with, similarly titled measures of other companies. However, we have included pro-forma EBIT before discontinued operations, pro-forma Adjusted EBITDA, and pro-forma Adjusted Net Income attributable to Dole plc herein because Dole plc’s management believes that pro-forma EBIT before discontinued operations, pro-forma Adjusted EBITDA, and pro-forma Adjusted Net Income attributable to Dole plc are useful performance measures for it. These non-GAAP financial measures have limitations as analytical tools, and you should not consider them in isolation or as a substitute for analysis of our operating results, cash flows, or any other measure prescribed by GAAP.

Dole is not able to provide a reconciliation for FY'22 Adjusted EBITDA without undertaking unreasonable efforts.

About Dole plc

A global leader in fresh produce, Dole plc produces, markets, and distributes an extensive variety of fresh fruits and vegetables sourced locally and from around the world. Dedicated and passionate in exceeding our customers’ requirements in over 75 countries, our goal is to make the world a healthier and a more sustainable place.

Webcast and Conference Call Information

Dole plc will host a conference call and simultaneous webcast at 08:00 a.m. Eastern Time today to discuss the fourth quarter and full year 2021 financial results. The webcast can be accessed within “Events and Presentations” on the company website, www.doleplc.com/investors.

An archived replay of the webcast will also be available shortly after the live event has concluded. For those without internet access, the conference call can be accessed live by dialing 1-855-979-6564 or for international callers by dialing +44 203 936 2999. The access code is 138905.

A replay of the call will be available through March 31, 2022, by dialing 1-845-709-8569 or for international callers by dialing +44 203 936 3001. The replay access code is 351400.

Forward-looking information

Certain statements made in this press release that are not historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are based on management’s beliefs, assumptions, and expectations of our future economic performance, considering the information currently available to management. These statements are not statements of historical fact. The words “believe,” “may,” “could,” “will,” “should,” “would,” “anticipate,” “estimate,” “expect,” “intend,” “objective,” “seek,” “strive,” “target” or similar words, or the negative of these words, identify forward-looking statements. The inclusion of this forward-looking information should not be regarded as a representation by us or any other person that the future plans, estimates, or expectations contemplated by us will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business prospects, growth strategy and liquidity. Accordingly, there are, or will be, important factors that could cause our actual results to differ materially from those indicated in these statements. If one or more of these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, our actual results may vary materially from what we may have expressed or implied by these forward-looking statements. We caution that you should not place undue reliance on any of our forward-looking statements. Any forward-looking statement speaks only as of the date on which such statement is made, and we do not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made except as required by the federal securities laws.

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